Information Technology and the World Economy
Scandinavian Journal of Economics, Vol. 107, No. 4, pp. 631-650, 2005
Posted: 17 Oct 2011 Last revised: 15 Sep 2014
Date Written: December 1, 2005
This paper addresses the impact of investment in information technology (IT) on the recent resurgence of world economic growth. We describe the growth of the world economy, seven regions and 14 major economies during the period 1989–2003. We allocate the growth of world output between input growth and productivity and find, surprisingly, that input growth greatly predominates. The contributions of IT investment have increased in all regions, but especially in industrialized economies and Developing Asia. Differences in per capita output are explained by differences in per capita input, rather than by variations in productivity.
Keywords: growth, investment, productivity, information technology
JEL Classification: 047
Suggested Citation: Suggested Citation